No Third Party the financial question dr jekyll and mr hyde

The savings plan DenizBank offers 2.8 percent interest for eight years term. Of 96 (92 months, the bank does not offer) monthly installments of 500 euros will be 52,188 euros after tax. Thus only one loan of 47,812 euros is needed. 428 euros per month are available for the interest and the repayment of the loan in 144 months. That’s 3 euros less a notional balance of payments than the savings agreement. 428 euros monthly cost interest and repayment of the loan at an interest rate of 4.4 percent. That is the limit interest rate. the mortgage rate the end of 2022, beginning of 2023 is about 4.4 percent, the bank alternative is more expensive than the building society financing.

The table shows marginal interest and total payments for different total transit times a 100 000-euro financing. It’s all about a Wüstenrot savings agreement and the combination of Deniz savings plan and mortgage.

As long as the low-interest rates last?

The key question for investors is, therefore: Rising mortgage rates over the next ten years, more than 4 percent, or not? The additional question: If interest rates rise for purely subordinated mortgage over 4 percent or not? To understand the priority: In the land register of the property, the land charges, and mortgages in the order, you entered. The first rank is safer for the lender. He is usually up to 60 percent of the loan value.

Behind it is less safe for the creditors. Therefore ask banks for purely subordinated loans up to 80 percent of the loan value will be awarded a premium of more than one percentage point on the interest. In other building societies: they require no higher interest on its subordinated loans up to 80 percent of the loan value. The additional question whether the interest on purely subordinated mortgages in the next ten years will rise about 4 percent, with a view of market interest rates, which are usually called only for first mortgages means that if interest rates rise in the next ten years, more than 3 percent?

Not only cautious contemporaries can imagine that interest rates will again exceed that mark in ten years today. Just a reminder: On average the past 35 years, the first-rate mortgage rates stood at 6.77 percent effective. The example of Japan teaches the other hand, that low-interest rate phases may take longer than 20 years. Nevertheless, the limit interest rates show that good savings contracts are now for the low-interest financing real estate projects later a very good choice. This is especially true for the subordinated financing parts.

The winner in the van loans

The good choice is not the case with the building society contracts and (building society) loans, currently, like to be installed without saving phase of the mediators “to hedge” in financing. If banks require less than 2 percent interest rate for maturities of 20 years, cheaper deals are difficult. This also applies to building societies and their so-called combo loans. How wrote the Stiftung Warentest in February last year: “combination loans with savings agreements are times extremely cheap, sometimes outrageously expensive – but almost always a sham. A legal loophole allows referencing misleading effective interest rates for estate loans to building societies. It lacks hidden loan costs by thousands of Euros. Therefore, the combination loans are usually much more expensive, can be as banks and building societies believe their customers. ”

The financial question: Against the cold expropriation

Bockholt also knows what to do. Each builder can have it figure out whether the combination of credit building society or the mortgage loans the bank is more favorable. The client determines as to when the loan is to be definitively eradicated. For example, for retirement: “At the total term of the loan offers the banks and savings banks are collected. And the loan with the lowest rate makes the race”-

The table shows that when comparing senior loans refinanced by a combination of a good credit-building society is significantly more expensive than the offer of a good bank. Only in purely subordinated loans with long maturities of the combined credit is cheaper. were compared financing offers Wüstenrot & Württembergische AG and HypoVereinsbank, which, according to the Stiftung Warentest currently best national mortgage providers with the branch network. Credit: 100.000 EUR, which run until the end of the repayment amount to 10, 15, 20 and 25 years.